SandRidge Offers Icahn Some Deal Records, Rebuts Claims

SandRidge Energy Inc on Monday pushed back against activist investors Carl Icahn and Fir Tree Partners' attack on the oil and gas producer's proposed $746 million acquisition of rival Bonanza Creek Energy Inc.

In a letter to its shareholders, the Oklahoma City-based energy firm said opponents' claims the transaction would hurt shareholder value were "false and reckless," and a purchase would boost cash flow per share by 15 percent next year and provide operational and financial synergies.

It also said it would expect to have greater than $300 million in liquidity at the deal's closing through a planned $700 million credit facility.

Both activist investors have assailed the deal. Icahn, who holds about 13.5 percent of the oil company's shares, has called the offer "value-destroying" and said it provides "no obvious synergies nor economies of scale".

Icahn, a billionaire activist known for shaking up management at companies, said in an open letter to SandRidge's board released Dec. 1 that he may look to overturn the company's board of directors.

Icahn could not immediately be reached for comment on Monday.

Fir Tree, which holds about 8.3 percent of SandRidge shares, has described the bid as providing an "unjustified premium."

In early trading on Monday, Bonanza Creek shares were up 2.5 percent at $27.50, well below SandRidge's Nov. 15 offer of $36 a share in cash and stock. SandRidge shares were up 2 percent at $18.69.

SandRidge on Dec. 8 also agreed to make some company records available to Icahn subject to reaching a confidentiality agreement, according to a federal filing released on Monday.

The company wrote that Icahn's efforts to discuss his opposition with others or seeking to remove members of the board would not automatically trigger the company's poison pill plan. On Dec. 1, the activist investor had asked the oil and gas producer to release internal documents on its proposed acquisition and posed a series of questions on what the shareholder rights plan would bar.

Icahn has said he wants to investigate deliberations involving the deal and other matters including executive compensation at SandRidge.

By Gary McWilliams